Digital Currency Research Articles

Wholesale Central Banks Digital Currencies and New Opportunities for Interbank Settlements with the Prospect of Entering International Transactions

A new generation of digital technologies that make it possible to speed up settlements and reduce their cost was born from crypto-currency projects, but the prospects of their economically effective and socially responsible application associate with central bank digital currency. The article discusses the issues of digitalization of central bank money in relation to interbank settlements, including for servicing cross-border payment turnover. So far, this topic has not found a significant response in Russian scientific journals. This publication aims to popularize it by summarizing and analyzing examples extracted from foreign experiments. The advantages of digitalization are compared with the capabilities of conventional payment systems. Descriptions and comparisons of the architectures of the new generation payment system are given, in the range of which it is possible to choose compromises between benefits, risks and costs in the search for the optimal solution. In conclusion, the prospects for the transition to an experiment with digitalization of wholesale payments in Russia are assessed following the upcoming introduction of the “retail” digital ruble

The impact of a cashless electronic payment system on hyperinflation in Bangladesh

The increase of electronic payment methods, or payments that don't include the use of currency has transformed financial transactions. Non-cash transactions are convenient, simple, and fast, among other benefits. Furthermore, payments without cash have an effect on Bangladesh's currency management. The practicality that comes with using transactions without cash causes the velocity of money to increase. The society has seen a decline in payments in cash, yet the velocity of currency causes an intense pace when transactions without cash are used. It is thought that increased money transmission capacity will have hyperinflation implications. The purpose of this study is to ascertain how the cashless payment method affects hyperinflation. This research utilized an analytical approach and additional information from the beginning of 2021 to the end of 2023 that had been collected through Bangladesh Bank using verification methodologies. Multiple linear regression analysis is the process of research. The findings indicated that the factors related to digital currency experienced significant adverse effects, the factors related to debit cards, credit cards, online banking, or mobile banking had a major beneficial effect, the parameters related to credit cards had a meaningless unfavourable impact, and the variables related to rates of interest had an important beneficial effect.

Правовые основы и перспективы использования цифровых финансовых активов и цифровой валюты в трансграничных операциях

The article is devoted to the study of prospects for the use of digital financial assets, digital currency, as well as the digital ruble in cross-border operations, which could be considered as counter-sanctions measure. Special attention is paid to the adopted and pending amendments to legislation related to the use of digital assets and currencies in crossborder transactions, author analyzes possible models and mechanisms for conducting such transactions and the necessary infrastructural, economic and legal conditions for its implementation.

Best Before? Expiring Central Bank Digital Currency and Loss Recovery

AbstractPhysical cash enables payments in the absence of electricity or network coverage. Such offline payment functionality promotes the operational resilience and, particularly in developing countries, the accessibility of payments. Central banks are exploring issuing digital cash substitutes with similar offline payment functionality. Such substitutes could incorporate novel features, making them more desirable than physical cash. This paper considers automating personal loss recovery for offline digital currency balances through the introduction of an expiry date. Our results show this functionality could have a substantial positive impact on consumer demand for offline digital currency balances. We find an asymmetric impact on welfare of adjustments to the expiry date: small increases from the optimum cause little damage, but small decreases from the optimal expiry date can have a large negative impact. More information‐sharing between user devices and the central bank can improve loss recovery but has an ambiguous impact on social welfare.

Развитие общего финансового рынка ЕАЭС: правовые аспекты

In the article, it was considered the areas of the development of the common financial market in the EAEU: expanding the list of countries participating in the forming of the com-mon financial market; deepening integration in those sectors and areas in which it is already taking place; inclusion of new sectors in the process of forming the common financial market. It is justified that the market of the digital currencies and financial assets will be a new sector of the common financial market in the EAEU in the future (along with banking, insurance and securities market).

Understanding the rapid development of CBDC in emerging economies

Central Bank Digital Currencies (CBDCs) mark a significant evolution in digital finance. This study examines the factors influencing CBDC adoption, highlighting the roles of regulatory quality and digital financial access. Results indicate that regulatory frameworks, rather than the level of digital infrastructure, predominantly drive CBDC initiatives. The findings caution against the rapid deployment of CBDCs in less prepared environments, which could pose risks to financial stability. The research underscores the importance of comprehensive regulatory strategies over technological readiness for successful CBDC implementation. Developed markets are advised to consider policies that mitigate risks associated with the transition towards digital currencies.

An Analysis of the Adaptability of Switzerland’s Financial Regulatory Framework to Blockchain and Digital Currency Innovations

Switzerland has emerged as a global leader in the regulation of blockchain technology and digital currencies, attracting numerous blockchain startups and investors to its “Crypto Valley.” This paper provides an in-depth analysis of Switzerland’s financial regulatory framework, examining its adaptability to blockchain and digital currency innovations. The study highlights the proactive stance of the Swiss Financial Market Supervisory Authority (FINMA) and the enactment of the Blockchain Act, which have created a flexible and forward-thinking legal environment. Furthermore, the paper explores the opportunities afforded by Switzerland’s regulatory framework, such as legal certainty, privacy protection, and access to European markets. However, it also addresses the challenges that remain, including regulatory arbitrage, scalability issues, and the unique regulatory complexities introduced by decentralized finance (DeFi) and non-fungible tokens (NFTs). The findings suggest that while Switzerland has built a conducive ecosystem for blockchain innovation, it must continue to adapt its regulatory framework to maintain its leadership position in an ever-evolving global landscape.

The Optimal Quantity of CBDC in a Bank-Based Economy

We show that the estimated effect of digital euro news on bank stock valuations and lending depends on the bank’s deposit reliance and the central bank digital currency (CBDC) design features. Using a quantitative DSGE model calibrated to the euro area economy that replicates such evidence, we find that CBDC issuance yields nontrivial welfare trade-offs between, on one side, the positive expansion of liquidity services and the improved stabilization of deposit funding and lending and, on the other side, a negative bank disintermediation effect. The optimal amount of CBDC lies between 15 and 45 percent of quarterly GDP. (JEL E23, E42, E58, F33, G14, G21)

Analysis of the Potential Impact of Central Bank Digital Currency (CBDC) on Banking in Indonesia

Analysis of the Potential Impact of Central Bank Digital Currency (CBDC) on Banking in Indonesia

Криптовалюта как обязательственное право

Russian legislation has long known the definition of digital currency, but for now no consensus has been reached on its true civil nature, thus complicating the development of a comfortable legal environment for the blockchain industry. In the course of fundamental scientific research, the author has conducted a public scientific field-study involving top digital lawyers and technical experts in cryptocurrency, which allowed to consolidate the viewpoints within the professional community and to thoroughly examine the arguments presented by opponents of bitcoin’s qualification as a property right. As a result of the experiment, the main arguments against the recognition of cryptocurrencies as property rights have been disproven, providing for an opportunity to outline a comfortable legal framework for cryptocurrencies in continental legal systems

Implications of Central Bank Digital Currency for Monetary Operations

Implications of Central Bank Digital Currency for Monetary Operations

Positioning Central Bank Digital Currency in the Payments Landscape

Positioning Central Bank Digital Currency in the Payments Landscape

Central Bank Digital Currencies and Financial Stability: Balance Sheet Analysis and Policy Choices

Central Bank Digital Currencies and Financial Stability: Balance Sheet Analysis and Policy Choices

Digital geographies of power: The scale of digital money infrastructures

This paper examines the relationship between the scale, socio-political goals, and the technological design of digital money infrastructures. The backdrop is the digital currency industry that threatens to undermine institutions’ monetary powers. Institutions are developing digital money infrastructures conceived as public utilities. Scattered geographically and scaled differently, the coexistence of digital currency within the EU raises the question about the role of money in a digitized society. Eleven in-depth interviews with key actors and three publicly funded projects that organize digital money infrastructures were compared in this study. Smaller scale and bottom-up governance implies higher attention to local problems and social dynamics. Links with institutions and top-down decision-making remain necessary to ensure long-lasting and scalable digital money infrastructures. The geographies of power are co-shaped for each project. This demonstrates a very complex interplay of sociopolitical goals, data as part of the digital monetary design, and its scale that varies across time and space.

Retraction Note: Economic integration through renewable energy and digital currency in RCEP

Retraction Note: Economic integration through renewable energy and digital currency in RCEP

CRYPTOCURRENCY ADOPTION IN INTERNATIONAL MARKETS: CHALLENGES AND OPPORTUNITIES

Cryptocurrency is next in the list of gigantic financial innovations in modern times, changing the way any person, institution, and the government interacts through the global economy. Starting with Bitcoin back in 2009, it refers to decentralized digital currency based on the blockchain technology that can help someone carry out transparent, peer-to-peer, and safe transactions without using banks. There are numerous reasons that have fueled interest in cryptocurrencies, including financial independence, high returns on investment, and increased privacy in transactions. As cryptocurrencies take the world by storm in most international markets, they present major challenges and unique opportunities in equal measure. The acceptance of cryptocurrencies varies widely from country to country, depending on the regulatory environment, technology infrastructure, and cultural orientation toward digital finance. Areas with supportive regulations and the most advanced technological ecosystems promote rapid adoption, while restrictions in policies and limited technology access have hindered adoption in other areas. Apart from that, the inherent volatility of cryptocurrencies gives rise to several concerns with regard to using them as reliable mediums of exchange or stores of value, which may discourage potential users and investors. Security, fraud, and how a cryptocurrency works raise issues with trust, thereby making acceptance complicated. Despite these challenges, cryptocurrencies hold the potential for revolutionizing financial systems through financial inclusion in underbanked regions and facilitating faster, cheaper cross-border transactions. This paper aims to explore what factors drive the adoption or do not of the cryptocurrency by international markets and their related business and consumer implications. Through multiple case studies and insights obtained from various regions, the work attempts to deliver a profound understanding of the challenges posed by cryptocurrency adoption and at the same time the possible opportunities, in order ultimately to show the transformative value that cryptocurrency has in shaping the rapidly changing global economy.

REVIEWING LIMITED SUPPLY CRYPTO PROJECTS: ULTIMA, COREDAOVIP

Ultima (also referred to as PLC Ultima) is a cryptocurrency and blockchain-based ecosystem aimed at providing a range of financial services. It offers tools like a cryptocurrency debit card, minting and farming solutions, cashback programs, and cryptocurrency wallets. The primary goal of Ultima is to facilitate global financial inclusion by giving users access to fintech services that traditional financial systems may not offer. On other hand, COREDAOVIP is a blockchain-based platform designed to enhance decentralized finance (DeFi) and NFT ecosystems through innovative liquidity pooling and automated trading mechanisms. Built on the foundation of Core DAO’s decentralized principles, COREDAOVIP aims to provide users with secure, transparent, and efficient financial solutions. It integrates smart contracts and cross-chain compatibility, enabling seamless interaction between different blockchain networks. Additionally, COREDAOVIP facilitates decentralized identity systems, offering users control over their data and assets while supporting NFT projects like 9NFTMania, which merges digital currency with NFT art. As DeFi and blockchain adoption grow, COREDAOVIP is positioned to play a key role in transforming financial ecosystems through enhanced security, liquidity, and decentralized governance. This platform’s innovative approach to token integration and decentralized trading enhances its potential in the rapidly evolving blockchain landscape.

Retail CBDC: Implications for Banking and Financial Stability

This article reviews the literature examining how the introduction of a retail central bank digital currency (CBDC) would affect a modern economy, focusing on the implications for the banking sector and for financial stability. A CBDC can improve welfare by reducing financial frictions, countering market power in deposit markets, encouraging financial inclusion, and enhancing the payment system. However, a CBDC also entails noteworthy risks, including the possibility of bank disintermediation and associated contraction in bank credit, as well as potential adverse effects on financial stability. The recycling of the new CBDC liability through asset purchases or lending by the central bank plays an important role in determining the economic consequences of the introduction of a CBDC, raising fundamental questions about the footprint of central banks in the financial system. Ultimately, the effects of a CBDC depend critically on its design features, particularly remuneration.

Combating terrorist financing in cryptocurrency platforms: The role of AI and machine learning

This study addresses the critical issue of terrorist financing through cryptocurrency platforms, a growing concern due to digital currencies' pseudonymous nature and global reach. The research explores the strategic role of Artificial Intelligence (AI) and Machine Learning (ML) in identifying, preventing, and disrupting the flow of illicit funds used to finance terrorism. Employing a mixed-methods approach, the study integrates qualitative case studies of documented instances of cryptocurrency-based terrorist financing with quantitative data analysis from significant cryptocurrency exchanges. Advanced AI and ML algorithms, including supervised learning models such as decision trees and neural networks, were applied to detect suspicious transactions indicative of terrorist activities. The findings reveal that AI and ML technologies significantly enhance the ability to identify patterns of terrorist financing within large and complex datasets, with models achieving precision and recall rates exceeding 90%. However, challenges remain, particularly regarding the quality and standardization of data across platforms, algorithmic biases, and the need for continuous updates to counter evolving tactics used by terrorist organizations. The study concludes that AI and ML present powerful tools for enhancing financial security. However, their successful implementation requires overcoming these challenges through collaborative efforts among stakeholders, including financial institutions, regulators, and technology providers. This research contributes to the growing field of economic crime prevention by offering a robust framework for integrating AI-driven solutions into the fight against terrorist financing on cryptocurrency platforms.

DIGITALIZATION CHANGES CRIMINAL PROTECTION OF CITIZENS' RIGHTS AND FREEDOMS

The widespread use of modern digital technologies has raised a number of complex issues related to the investigation and resolution of criminal cases before law enforcement specialists. The mechanism for bringing to criminal liability by introducing a new crime related to the use of digital technologies into the Criminal Code of the Russian Federation, proposed by legal theorists, turned out to be an unsuccessful solution. This is due to the fact that there is an increase in the number of crimes related to digital technologies in one way or another. In this regard, this study becomes especially relevant. The purpose of the study is to determine how digitalization affects the protection and defense of public relations within the framework of criminal law. To achieve this goal, it is necessary to solve the following tasks: identify the signs of crimes committed using digital technologies; determine the most effective ways to counter such crimes; point out the mistakes that cybercriminals most often make when committing crimes. The following methods are used in the work: determinism, systemic, logical, comparative legal and functional. Conclusions: Digitalization transforms the methods of committing crimes, increases their latency and complicates the investigation and resolution of criminal cases. However, this process can be facilitated by involving highly qualified specialists (experts) in the field of high technology. The most vulnerable point in the process of committing a crime by a cybercriminal is the exchange of digital currency for regular money, which occurs through a bitcoin exchanger. Having studied it, you can identify the owner of the crypto wallet. The use of digital technologies (including cryptocurrency) as a method or instrument of crime should be recognized as an aggravating circumstance under Article 63 of the Criminal Code of the Russian Federation. This is due to the increased public danger of this type of crime.